If the 2 5 years are exactly the same with the exception of having coupons (same lender, same claims, same everything) then yes you should be able to. The trick is finding the right yield curve and discounting everything back to the present value. The coupons can be treated as mini zero-coupon bonds in their own right.
When the yield of a bond exceeds it coupon rate, the price will be below 'par' which is usually $100.
The YTM on a Bond versus it's Price is inversely related. Thus when the Price of the Bond Increases, the YTM Decreases.
Nothing. Once you enter into a put contract, the strike price remains the same. If the stock price goes over the strike price and stays there until expiration, you just let the put expire.
Once you enter into the contract, you can't change the price.
Capital Gains Yield = (Ending Price-Beginning Price)/Beginning Price For example, if you buy stocks in Apple, Inc. at a price of $100 and a year later the stock is valued at $110, the capital gains yield is equal to 10%
Compute the current price of the bond if percent yield to maturity is 7%
When the yield of a bond exceeds it coupon rate, the price will be below 'par' which is usually $100.
Yields and Price for bonds are inverse. So when price goes up yield goes down. When price goes down , yield goes up. The coupon always remains fixed.
1,111.50 (Annual coupon)
No......The price of the bonds will be less than par or 1,000.....
Zero coupon bonds are sold at a price well below face value. Thus, these bonds are appealing to the small investor because they can be bought far more cheaply than ordinary debt obligations. The discount is usually from 50 to 75 percent.
par value
The price of bonds is inversely related to interest rates. If interest rates rise, the value of existing bonds will decline since the coupon rate available on newly issued debt will be higher due to the increase in interest rates. The price of existing bonds will drop in price until the bond provides a yield similar to comparable newly issued debt.
You don't find it, you calculate it based upon; 1) Outstanding Maturity 2) Coupon Rate 3) Market Price
I've heard of price often being compared with passenger mileage to compute proper ticket price.
The bond's price is $996.76. The YTM is 8.21%. by E. Sanchez
Zero coupon bonds issued by the US Treasury are issued at a discount to face value. An investor holding zero coupon bonds is paid the full face value when the zero coupon bond matures. The difference between the purchase price and the maturity value is know as the original issue discount which represents the interest earned on the zero coupon bond. Although a zero coupon bond does not pay annual interest, an investor must pay taxes each year based on the imputed receipt of income. Since the investor is not receiving interest payments during the life of the bond, taxes would be paid on interest income not actually received until bond maturity. Due to the yearly tax liability on imputed interest, it makes sense for most investors to hold zero coupon bonds in a tax deferred retirement account. The interest earned on zero coupon bonds issued by the US Treasury are exempt from state and local taxes.